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Monday, July 3, 2017

( July 1, 2017, Boston, Sri Lanka Guardian) Free
trade, debt and war are all part of the same package, each feeding off
the other. They are – each of them – rackets in their own right and they
are all symptoms of the same problem. That problem has to do with the
fact that our government – along with the rest of the world – has
entirely forgotten the basic concept of how a national economy actually
“earns” its way to prosperity.

The American colonists understood this in a very visceral way. For
example, Benjamin Franklin once remarked that there are only three ways a
nation can become wealthy. (1) It can engage in war and war
profiteering. (2) It can reap unearned profits through exploitation of
wage and price differentials, under cover of “free” trade. OR (3) It can
create new, earned wealth through a balanced domestic exchange economy.

Franklin, like the other colonists, knew whereof he spoke, having
witnessed firsthand the shenanigans of the British East India Company,
which not only began using slave labor for its operations by the 1620’s
but which required England to continually bail it out, heaping extra
debt on the English people and forcing England to look for tax revenue
from her increasingly disgruntled American colonies.

But bailing out the East India Company was not the real reason why
England was in debt. That state of affairs must be attributed to the
fact that England had, in 1666, relinquished her prerogative to issue
the nation’s money – a prerogative sanctified by the world famous Mix’t
Moneys case of 1604. Instead of maintaining that prerogative for the
benefit of her people, England was persuaded, through bribery, intrigue
and various forms of subterfuge to surrender that prerogative over to
private hands – those hands being those of the British East India
company, through the Mint Act of 1666.

The East India Company thus was given the right to coin – or issue – its
own money, allowing it to reap handsome profits for the privilege.
Still not satisfied, the merchants of the Company, together with London
bankers, then instigated the creation of the Bank of England and a
permanent national debt along with a method for expanding the private
debt of England’s citizens, all to the financial advantage of these
private interests. . .

The “money question” which the East India Company had seized for the
benefit of itself and not the public was the actual source of England’s
growing debt, and the reason behind her endless wars waged on behalf of
commerce.

The British East India company was created in 1600 by charter from Queen
Elizabeth, for the purpose of plundering the planet. To carry out this
deed, England also provided the British East India Company with military
and financial support, forcing the government to bail the Company out a
number of times before 1800, thereby helping it to eventually build its
very own empire in India. British colonialism carried out by the East
India Company was brutal, and included the forceful seizure of land and
deposing of rulers. It also included taxes and loyalty tributes that
were extracted from average citizens through methods that included
torture.

The deeper in debt England became the harder she looked for revenues –
with her own people being among those most imposed upon. Jefferson
comments in an 1816 letter to Wm. H. Crawford, and in so doing he almost
eerily predicted today’s multiple crises:

No earthly consideration could induce my consent to contract such a debt
as England has by her wars for commerce, to reduce our citizens by
taxes to such wretchedness, as that laboring sixteen of the twenty-four
hours, they are still unable to afford themselves bread, or barely to
earn as much oatmeal or potatoes as will keep soul and body together.
And all this to feed the avidity of a few millionary merchants and to
keep up one thousand ships of war for the protection of their commercial
speculations.

The problem, as Jefferson and company could see, was that England had
chosen to elevate herself above all other nations based on John Locke’s
philosophy called “the rights of conquest” and so was dependent upon the
plundering and pillaging of the British East India Company. With
England’s cooperation, the Company was, by 1800, supporting its very own
army of 200,000 – more than most European states at the time. It also
had begun financing its tea trade with illegal opium exports to China,
eventually igniting the infamous Opium Wars.

The company also established its own feeder college in 1806, known as
Haileybury College or East India College, for the express purpose of
staffing the Empire. It trained the soldiers, businessmen, and
missionaries – and by these means it came to inventory the planet and
its resources. The man in charge was the head of the Department of
Economics, one Thomas Robert Malthus, philosopher and a minister of
Christian Doctrine.

Malthus had a population theory based on the idea that the planet would
be overtaxed with population. New life, he held, expanded geometrically,
whereas the food supply acquired new efficiency only on an arithmetic
basis. Therefore some life was superfluous. Malthus was soon joined by
followers of Charles Darwin, who argued for survival of the fittest. The
fittest had divine right to survive.

This was the philosophy that set the Dutch, French, Spanish, Portuguese,
and finally the English on a course of conquest until each coveted
acre, each sandbar, each spit of land on earth was accounted for. One
might say that our modern-day CIA Fact Book, which can be viewed online,
has taken over this task, but I digress.

It was at the juncture during which the slave trade was just expanding,
around the mid-1700s, that the talent scouts of what was to become
Haileybury College availed themselves of the services of a Scottish
gentlemen by the name of Adam Smith, who fit into the mental prototype
for the East India company’s enslavement pursuits. Smith was in effect
made an intellectual prostitute. In his well-known Wealth of Nations,
Smith posits a deceptively appealing argument in favor of “free” trade
by warning against the necessity of domestic producers seeking
protectionism. Smith might just as well have been called the father of
“Free” trade as the father of modern economics.

In due course the English pronounced expendable any population they
could bully. Except for Continental wars, the British rarely fought an
enemy that wore shoes, the American colonies excepted… A certain mindset
thus developed among the world’s leading countries which held that it
was the role of a few traders to control manufacturing for the entire
world and to monopolize its reproductive power; and – as one historian
put it – to keep all other countries in a state of industrial vassalage.

Given all this is it any wonder that Thomas Jefferson, expressing the
views of his allies and compatriots, would write in 1815 that he hoped
that “we shall crush in its birth the aristocracy of our moneyed
corporations, which dare already to challenge our government to a trial
of strength, and bid defiance to the laws of our country.” The banks,
for Jefferson, were the corporations of utmost concern.

You might say that all of this proves that history may rhyme, as Mark Twain famously said, but history also repeats.

It’s no secret that war is very good for business, but war is also good
for “free” trade advocates – who always include the multinational
corporations and by extension the investment class and most importantly
the banks – who in point of fact make it all happen. Smedley Butler may
have said it best in his 1935 book appropriately titled War Is a Racket:

I helped make Mexico safe for American oil interests in 1914. I helped
make Haiti and Cuba a decent place for the National City Bank boys to
collect revenues in. I helped in the raping of half a dozen Central
American republics for the benefit of Wall Street. . . . For a great
many years as a soldier I had a suspicion that war was a racket; not
until I retired to civil life did I fully realize it. Now that I see the
international war clouds gathering, as they are today, I must face it
and speak out. Again [the nations of the world] are choosing sides. . .
All of them are looking ahead to war. Not the people, not those who
fight and pay and die – only those who foment wars and remain safely at
home to profit.

Recall that this book was written in 1935, but I digress again.

The untold truth is that America consigned herself to endless and
ever-escalating “wars of commerce” the moment she followed in the steps
of England by handing over her prerogative to issue the nation’s money
to the private banking and financial interests in 1913. Those private
interests then moved to further coalesce their profits and consolidate
their power through an integrated world system of finance under the
structures created by the Bretton Woods Agreement of 1945 – all built on
the fact that, by that time, most nations of the world had relinquished
their right – and responsibility as sanctified by the Mix’t Moneys case
of 1604 – to coin (or create) their own money for the benefit of the
people and not private interests.

Today, the world economic system actively and aggressively promotes
military economies over civilian economies, relentlessly and
increasingly pushing national economic policies toward military
spending. Globalization, through a long parade of so-called “free” trade
agreements, has seriously weakened the powers of even the most powerful
nations on earth while at the same time freeing corporations to move
profits and operations across national boundaries. As Jefferson foresaw,
and as the East India company foreshadowed, corporate interests now
dominate those of the state.

Popular New York columnist Thomas Friedman somewhat inadvertently
characterized the strategic relationship that has developed between
corporations and militaries when he famously remarked that “the hidden
hand of the [“free”] market cannot flourish without a hidden fist.”
Predictably, the reach along with the strategies and techniques employed
by that hidden fist have been greatly refined and extended since the
days of the East India Company.

For example, corporations no longer have their own private armies.
Instead they employ the services of multinational corporations such as
Dyncorp, KBR, the British Erinys International, Asia International and
Blackwater, currently known as “Academi.”

How, it may be asked, do we talk ourselves into financing – i.e. going into debt – for all this stuff?

Surprisingly the services of these companies are used not only by
governments around the world but also by corporations, humanitarian
groups and NGOs, media personnel, and the UN. Moreover, the conflict in
Iraq led to an unprecedented proliferation of private military companies
and nonmilitary contractors.

Today, contractors make up a second, private army that’s larger than the
entire U.S. military force. Some estimates suggest that more than
180,000 individual contractors of many nationalities work for the U.S.
government in Iraq, doing an assortment of jobs for which the U.S. has
paid more than $100 billion. While private military companies represent a
worldwide phenomena, the United States and Great Britain – predictably –
account for over 70% of the world’s market for the services of these
private military services companies.

Then we have the international arms trade, which is considered to be one
of the three most corrupt businesses in the world. And reminiscent of
the British East India Company, open slave markets have begun to appear
in Libya, this at the same time that women in Bangladesh are selling
their organs to pay off their internationally financed micro-loans and
farmers in India routinely commit suicide because they cannot pay their
debt to Monsanto and company. Examples go on and on.

All of this and more is the direct result of overwhelming debt among
nations that have relinquished their prerogative to coin (or create)
money for the public advantage and instead have handed it over to
private hands. Most of the resulting debt is financed by the
international investment banks, including those of the World Bank Group
created out of the Bretton Woods agreement of 1945.

Meanwhile, as our own local police get “weaponed up” with things like
Blackhawk helicopters, machine guns, battering rams, armored vehicles
and much more, more and more state and local governments are being
forced into bankruptcy. Other governmental entities manage to escape at
least temporarily by simply finding ways to pay higher interest and
insurance rates as they float more bond debt to remain in operation.

Still others look for ways to “privatize” public assets – an arrangement
that allows government and business to co-own a former public asset
which had been built by you and me – with associated fee structures
locking out the disadvantaged and squeezing the middle class. These
arrangements, known as PPP or public/private partnership projects, are
made by investment bankers around the globe, who themselves are rushing
to benefit from the tidy fees they know will be realized through the
privatization of all manner of public infrastructure including highways,
water departments, schools, prisons and more.

As the British East India company showed, control over money creation
and credit is an integral part of economic conquest; it is the basis
upon which countries are colonized. A recent article in the online
ZeroHedge showed that about 80% of the population are net payers of
interest, due to the fact that the cost of interest is always embedded
within the cost of the products we buy. The other 20% of the population
are net receivers of interest, and of that 20% only 4% receive most of
the interest on our cumulative debt. All of which means that the wealthy
own interest-yielding assets, while the rest of us owe interest on the
debt. This fact alone explains how and why the system as it stands
produces the widening gulf between the haves and have-nots. It also is
the reason why our national debt hovers around $20 trillion, give or
take a trillion or two, and our private debt hovers around $57 trillion,
give or take a trillion or two.

Obviously more debt will not resolve debt. The assets created by our
labor cannot simultaneously be a liability we owe to ourselves at
interest. At the core of it all is that we have entirely forgotten the
basic concept of how a national economy actually “earns” its way to
prosperity – and have instead been persuaded by the best prostituted
intellectuals and academics that money can buy to believe that the best
way to prosperity is to become an interest receiver.

Nearly buried in the trash heap of history, a team of like-minded and
highly credentialed raw materials economists uncovered a natural law of
physics and arithmetic that helped them prove beyond all doubt that raw
materials income, particularly that of agriculture, governed national
income unless the latter was expanded by debt. Their data also made it
clear that when trade is expanded beyond what the nation itself can
consume, the internal domestic U.S. economy is destabilized. This is the
process by which, as Charles Walters said, the nation that degrades
either the production or the income of its agriculture through “free”
trade thereby condemns itself to war.

Suggested Resource 1.

1.“The
Untold Story of the American Struggle Against the Money Power” with a
selected list of references provided in the last slide

Geraldine
Perry is the co-author of The Two Faces of Money and author of Climate
Change, Land Use and Monetary Policy: The New Trifecta.